The best solution? An accounting service with specialized expertise surrounding the ins and outs of the industry. Many common problems can be avoided with a professional team in your corner, and virtual accounting services are available only when—and if—you need them.
Surviving in a Seasonal Business
A company might expect less traffic during a lull, but the unfortunate truth is that the overhead costs of operating a business don’t stop. And that’s where virtual CFO services come in. The right expert generates more revenue for the company by managing cash flow, budgeting, and forecasting. Surviving as a seasonal business is next to impossible without effective accounting strategies, but there are other ways to prepare for the year ahead.
Identify the most common industry challenges.
Unstable cash flow is the obvious elephant in the room, but there are other obstacles waiting to trip you up. For example, it can be difficult to hire and retain employees due to the limited nature of the work. Recruiting quality seasonal employees can be an unexpected challenge faced each year.
Many young businesses make the mistake of spending far too much money when revenue is at its highest, but this leads to shortages and the risk of cutting corners later in the year. Without consistent profits during the off-season to offset the outflow, it's easy for a company to find itself digging a financial hole.
Another issue involves inventory surplus and deficit. Either can be costly for the business, and inventory management should be tackled in advance to avoid expensive surprises.
Optimize use of off-season time.
Quiet periods are like the calm before a storm, so to speak. Downtime is when a company gets to catch its breath and handle any financial planning, inventory, maintenance, or renovations needed. That way, when the storm arrives in the form of peak season, the business is optimized for maximum revenue gains.
This is also the perfect time to analyze, plan, and implement other changes needed to reach your business goals.
Budgeting for Year-Round Efficiency
Can’t justify a full-time in-house accounting team despite knowing that you need one? Then don’t—it’s that simple. Leave the heavy lifting to virtual accounting services that are on hand when and how much they’re needed by crunching numbers and analyzing report data to accurately plan and manage the ebbs and flows of a seasonal business.
A seasonal industry also benefits from diversifying revenue streams. Transform unproductive lulls into lucrative opportunities when you stagger seasonal sales cycles and offer additional goods or services. Refining your customer pipeline leads to an enhanced consumer experience and a boost in profits.
Make the most of your budget forecast and always strive to improve efficiencies at every level of the organization. Another thing companies might not consider when flush with revenue is opening a credit line. But that’s exactly when you should head to the bank. Peak season translates to the best deals and interest rates available—something you’ll want to take advantage of when cash flow is stunted.
The way you market during the off-season can also influence sales. Stir interest and keep people engaged throughout the year so that they stay excited about and aware of your business.
And lastly, while you can’t plan for everything, you can prepare for the typical fluctuations experienced in the industry. Building a cohesive strategy can set the stage for a successful season every season.
Overcoming Financial Challenges with Virtual Accounting Services
Every corporation has its challenges, and seasonal businesses are no exception. Protect year-round financial health with the help of virtual accounting services, including virtual CFO services, a bookkeeper, or a controller. Remote teams are more cost-effective than an in-house team and provide niche expertise to propel your business.
Ignite Spot will help you identify challenges and opportunities while keeping the books organized. Plus, our packages can be customized to your specific needs, so you only pay for what you need when you need it.
Read more about Ignite Spot’s financial expertise and take control of your business’s financial success.